One of the most common things to do with an old PC is to turn it into a data server. This basically means that the only purpose of your PC is to run a bunch of hard drives. While it's connected to your WiFi network, it can serve as a data hub. Depending on how many hard drives you're using in this new configuration, one of these will probably be enough for the whole family.
1. Format your main drive, C:\ after having backed up the old data. Once it's formatted, it's completely wiped clean. If it's an old computer, you can always format a few times, just to be thorough.
2. Install Windows 7. Linux could also work, if you know how to do this.
3. Install as many hard drives as will fit, probably between 2 and 5, depending on the available space and ports.
4. Connect your PC to your WiFi network so that all of the computers within the network can use your PC to save data.
5. You'll have to allow the sharing of drives. Right-click on the drive, select Properties and then Sharing. You'll have to set-up a sharing account to allow people access to this. This can be done via the Control Panel's User Accounts.
(Images: Flickr member Marcin Wichary licensed for use under Creative Commons, Flickr member Waleed Alzuhair licensed for use under Creative Commons and Flickr member William Hook licensed for use under Creative Commons)